Atheros Announces First Quarter 2010 Results

Revenue Increased 16% Sequentially to $214.7 Million

SANTA CLARA, CA--(Marketwire - April 19, 2010) - Atheros Communications, Inc. (NASDAQ: ATHR), a global leader in innovative technologies for wireless and wired communications, today announced financial results for its first quarter ended March 31, 2010.

Revenue in the first quarter of 2010 was a record $214.7 million, up 16 percent compared to $185.7 million reported in the fourth quarter of 2009. First quarter 2010 revenue increased 144 percent compared to $87.9 million reported in the first quarter of 2009.

In accordance with U.S. generally accepted accounting principles (GAAP), the company recorded net income in the first quarter of 2010 of $19.7 million or $0.27 per diluted share. This compares with GAAP net income of $15.6 million or $0.24 per diluted share in the fourth quarter of 2009. Net loss in the first quarter of 2009 was $7.6 million or $0.12 per diluted share. Cash, cash equivalents and marketable securities were $443.6 million at March 31, 2010, up $41.4 million from the balance at December 31, 2009.

Atheros reports gross margins, operating expenses, operating income, net income (loss) and basic and diluted net income (loss) per share in accordance with GAAP and additionally on a non-GAAP basis. Non-GAAP net income excludes, where applicable, the effect of stock-based compensation, amortization of acquired intangible assets and acquisition-related charges, the realized gain on sale or the impairment of long-term investments and the tax impact of these excluded items. A reconciliation of preliminary GAAP net income (loss) to non-GAAP net income, as well as a description of items excluded in the calculation of non-GAAP net income, is presented in the financial statements portion of this release.

Non-GAAP gross margins in the first quarter of 2010 were 49.5 percent, compared to 50.2 percent reported in the fourth quarter of 2009 and 48.1 percent in the first quarter of 2009. Non-GAAP operating income in the first quarter of 2010 was 21.4 percent of revenue, compared to 23.4 percent in the fourth quarter of 2009 and 3.2 percent in the first quarter of 2009.

Non-GAAP net income in the first quarter of 2010 was $40.7 million or $0.57 per diluted share, compared to $41.2 million or $0.62 per diluted share in the fourth quarter of 2009 and $3.9 million or $0.06 per diluted share in the first quarter of 2009.

"We experienced broad-based strength across our PC OEM and Networking channels including strong momentum for our newly acquired PLC business. Our success in growing the top line, and more importantly, the design win momentum in each of our sales channels, further validate our hybrid networking strategy and demonstrate our diversification initiatives are paying dividends," said Craig Barratt, president and chief executive officer of Atheros Communications.

Conference Call

Atheros will broadcast its first quarter financial results conference call today, Monday, April 19, 2010, at 2 p.m. Pacific time (5 p.m. Eastern time). To listen to the call from within the United States, please dial 877-835-9268 approximately 10 minutes prior to the start of the call. To listen to the call from outside the United States, please dial 706-634-9690 approximately 10 minutes prior to the start of the call. The pass code is Atheros.

Atheros' financial results conference call will be available via a live webcast, which can be accessed from the Investors section of www.atheros.com. Access the web site 15 minutes prior to the start of the call to download and install any necessary audio software. The webcast will be recorded and also made available on the web site for 6 months.

About Atheros Communications, Inc.
Atheros Communications is a global leader in innovative technologies for wireless and wired communications. Atheros combines its wireless and networking systems expertise with high-performance radio frequency (RF), mixed signal and digital semiconductor design skills to provide highly integrated chipsets that are manufactured on low-cost, standard complementary metal-oxide semiconductor (CMOS) processes. Atheros technology is used by a broad base of leading customers, including personal computer, networking equipment and consumer device manufacturers. For more information, please visit www.atheros.com or send an email to info@atheros.com.

Atheros and the Atheros logo are trademarks of Atheros Communications, Inc.

NOTE ON FORWARD-LOOKING STATEMENTS
Except for the historical information contained herein, the matters set forth in this press release, including our statements regarding our design win momentum, the anticipated success of our hybrid networking and diversification strategies and the benefits of using non-GAAP financial measures are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, difficulties in the development of new and enhanced products, general economic conditions, the effects of competition and technological change and the risks detailed in Atheros' Annual Report on Form 10-K for the year ended December 31, 2009, as filed with the Securities and Exchange Commission, and in other reports filed with the SEC by Atheros from time to time. These forward-looking statements speak only as of the date hereof. Atheros disclaims any obligation to update these forward-looking statements.

– Summary Financial Data PDF Link –

For analyst inquires contact: Jack Lazar, Chief Financial Officer for Atheros Communications, Inc.,
+1-408-773-5200; or David Allen, +1-408-830-5762, david.allen@atheros.com

Molly Mulloy, 408-830-5850, molly.mulloy@atheros.com, or Greg Wood, A&R Edelman for Atheros , 650-762-2838, gwood@ar-edelman.com

View All 2010 Press Release